It has been said that every large multinational started out as a small business. Hewlett- Packard started out in the forties in a garage (more on them a little later). The Business Times carried an article in yesterday's paper on small business and government's stance on this important sector of the economy. Carrying the punny title of "Why small is big in the economy" the story provided us with some interesting statistics on small businesses.
Like did you know (almost like a Chappies' wrapper)?
- small and medium businesses account for 50% of private sector employment and 80% of formal-sector job growth
- small firms are responsible for about a third of overall GDP (in contrast with developed economies where this is as much as two thirds)
- globally, the trend is that the “next big thing” tends to come from smaller firms rather than larger firms.
There is more in the article on the red tape that small businesses face in getting up and running (have you ever registered for VAT and PAYE?). You can read it online. The final paragraph is credited to Goolam Ballim, Standard Bank chief economist.
“From an economic perspective, economies grow only because of productivity growth. Small business is at the epicentre of potential innovation, and because of this, government needs to foster their long-term sustainable economic performance.”
Comments